ENCOURAGE GLOBAL CONNECTIVITY FOR GROWTH: AIRASIA BERHAD CEO
AirAsia, a leading low-cost carrier with dominant presence in Malaysia and a few Association of Southeast Asian Nations (Asean) markets, sees India as a growth driver. It has some big expansion plans up its sleeve over the next five years. AIREEN OMAR, chief executive officer, AirAsia Berhad tells Nirmalya Behera and Jayajit Dash that India has an enormous potential with its wide bouquet of tourism products. However, it needs to relax its international flying norms to boost connectivity and expand its GDP. Edited excerpts: What is your market share in Malaysia and other countries where you operate?
The market share is quite substantial in our respective markets where we are dominant in terms of being a low-cost carrier and in terms of air travel capacity, too. We are number one in Malaysia. Indonesia and the Philippines are smaller markets for us. We are number one in international connectivity from these countries. We work closely with AirAsia India on how we can feed them from Malaysia and Thailand and domestically as well.
For us, Asean is our backyard. With a strong base in Asean, where we operate from various hubs such as Malaysia, Thailand, Indonesia and the Philippines, we can reach out to larger markets such as China, India, Japan, Australia and the West Asia very effectively. That’s what our strategy and business model has always been.
Can India be one of your future growth drivers?
India can be one of the strong emerging markets we want to build. We want to be an aggressive group in India as we were in China. We want to connect more international destinations, beyond Asia, to India using our network in the Asean region. So, building a connectivity hub from Kuala Lumpur or Bangkok can work. There are 13 destination points in India with hubs in Bengaluru, Delhi and Kolkata. The fleet size of AirAsia in India is nine. Definitely, there is room for growth.
You believe India can emerge as AirAsia’s biggest market outside Malaysia?
I think so. It has tremendous potential. It can be a fantastic opportunity for Indians, too. India has a rich history and a host of tourism products, which if taken care of, can promote tourism. AirAsia India, where we own a 49 per cent stake, is our investment that we want to be a success. We also have a fleet delivery according to what we plan for the next five years. We have bigger expansion plans for India and also for the whole group because when India expands, it would be building a network and frequency, together as a group, with AirAsia Malaysia, AirAsia Thailand, maybe AirAsia Philippines, or even Japan. There are good growth opportunities.
But, India has this 0/20 flying rule. Is AirAsia not opposing it?
I think there are various communications between Amar Abrol (AirAsia India chief) and authorities to look into the ruling. India has a lot to offer as tourist destination. Tourism is a strong multiplier to the general economy of any country, maybe a 12 times multiplier. If you are able to get more international connectivity to India, the contribution to GDP would be larger and faster, thereby improving the economy. Connectivity is not only essential for just tourism — it is essential to facilitate growth of other industries such as education, infrastructure, health, among others. It implies meaningful trade and economic growth. For the benefit of the economy, they should encourage more and easier international connectivity.
“INDIA CAN BE ONE OF THE STRONG EMERGING MARKETS WE WANT TO BUILD. WE WANT TO BE AN AGGRESSIVE GROUP IN INDIA AS WE WERE IN CHINA. WE WANT TO CONNECT MORE INTERNATIONAL DESTINATIONS, BEYOND ASIA, TO INDIA” On India as a growth driver